What is Fuse?
Rari describes it as
Fuse is the first truly open interest rate protocol. Lend, borrow, and create isolated lending markets with unlimited flexibility.
Essentially, it’s like having your own isolated fork of Compound. Each pool is segregated from the others, so it reduces platform risk. For example, if a sibling pool becomes insolvent, the Ampleforth pool would still be fine and vice versa.
This creates an ideal, lower-stakes environment where we can try first use cases like AMPL as collateral before larger platforms. After some examination, it looks like we can very easily create pools there, including AMPL, without any integration concerns.
Is there demand out there for an Ampleforth pool? Would you personally use it?
Next, what assets should be included? As a starting point, I’ll propose:
Some others I would also consider:
- RAI in place of ETH
- DAI or USDT in place of USDC
- anything else?
I do like the idea of keeping this pool focused towards AMPL as a key building block and not having it too bloated with other assets. However, we do want it to be useful. Once we show it’s safe to use, we could see other pools incorporate it as well.
I like the idea of not letting AMPL be borrowed but used as collateral. I would vote for USDC or DAI tell we can get a button stable and push for the button stable as our primary stable and push for a community token swap once the forth claim phase has completed. What would we think for LTV 75% 65% 50%?
*** I think it would be ideal if we could land in another pool that already has liquidity, and we could bring value to the existing pool. Or if there was some market makers who would be interested in kickstarting the liquidity.
Would I be able to use forth as collateral? I like holding forth because I believe in ampl and would like to govern. But is feels really bad to have them just sit around in periods where there is nothing to vote on. It would be nice to put them to some kind of use especially if we go multiple months with no proposals.
Regarding the demand for lending and borrowing ampl I would think the success of what we’ve seen with aave would also transfer to fuse as well. I would expect demand to still be there.
I think what AMPL needs is an attempt to be in a closed-loop economic system, and for the use of AMPL as a lending asset I think it would be great. But that’s just the first step.
I recently had an idea if I could completely replicate an AMPL token and use it as an experiment in a full-fledged game system, since the game comes with a complete ecosystem.
I really like the idea of having an isolated AMPL focused lending pool.
Such a pool would be inherently more secure as we can decide on our own which tokens are accepted as collateral. As long as we are conservative with the collateral-enabled tokens, we should be secure from recent exploits a la Cream.
On the other hand, AMPL is a new kind of asset for lending markets and it makes sense for established lending markets to be cautious. With the proposed isolated lending pool, we could take the matter into our own hands!
The AAVE AMPL pool is growing like hell since the UI got fixed. However, AMPL is not eligible to be used as collateral on AAVE, and following the recent Cream exploit, they now disabled DPI and xSUSHI as collateral too.
Therefore, I do not expect the possibility to use AMPL as collateral any time soon.
Would I personally use it? Sadly no, as I’m outpriced by current gas prices. On a L2, Avalanche or Sidechain? Sure thing!
I think we need to be careful here.
- Would we want FORTH to be borrow-able?
- If so, how would this affect voting?
2.1) Can I vote with my deposited un-borrowed FORTH?
2.2) Could there be an attack vector by flash-loaning FORTH for a vote?
Regarding the included Assets
Totally agree here! However, I would imagine that the most borrowed assets would be AMPL and stables. No one likes to borrow WBTC or ETH.
Keeping this in mind, I would propose to include more than one stable coin, i.e. USDC and DAI.
I love this idea. After yield.credit is sunset on November 10th there’s no way to borrow from AMPL collateral at the moment (until Benqi I guess…?). I would personally use this to borrow off of AMPL and Forth since I’m a hodler, and I’m sure others are as well.
I’m personally not a fan of Dai and Frax because since they are backed by centralized stablecoins they have the centralized issuer risk in addition to their own specific platform risk. I’m curious how others feel about it though. I think USDC/USDT/RAI makes sense personally.
Love the idea, seems like a similar take to the one I proposed: FORTH on Compound
- Given that this is a compound fork, do we know how rebasing tokens behave on this protocol itself once lent/borrowed?
- In the case of FORTH, I don’t think it’s a good idea to have it be borrow-able since this can have bad implications during voting where people can buy influence temporarily
- Fuse is also live on Polygon, should we consider deploying there? This may provide increased borrow/lending activity because of the cheaper fees.
Pool can be called “Forth Knox”